Consumers support generic financial advice says Treasury report

Consumers have shown widespread support for a generic financial advice pilot says the Treasury.

The Treasury says around 5,000 people have taken advantage of a free, impartial and independent generic financial advice service as part of a 12-week trial testing out the concepts of delivering information and guidance on money matters, from jargon busting to saving for retirement.

The prototypes operated by A4e as ‘Money Fitness’, and Consumer Direct in partnership with Citizens Advice Bureau, form part of Otto Thoresen’s ongoing review of generic financial advice. The Treasury says the results of the pilot confirm the need for generic financial advice.

Initial findings show that many users feel they lack the confidence to buy savings and investment products without advice, and do not have a clear idea of which products would suit them.

The Treasury says generic financial advice was able to prompt people to take action – within a week of using the service 80 per cent of people surveyed had taken at least one follow up action, with one in five talking to a new supplier of financial products.

It found that people with household incomes over £40,000 were just as likely to call Consumer Direct as people with household incomes below £20,000, which it said supports the review’s principle of a service available to all.

A4e’s Money Fitness service took more calls on savings, including saving for retirement, than any other subject, with savings and investment queries accounting for two thirds of web-based enquiries.

The majority of people calling A4e’s Money Fitness line were aged between 26 and 35, with 50 per cent attracted to the service through newspaper articles or advertisements.

Thoresen is expected to publish his initial findings in the first half of this year.